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immediately following year, and each succeeding twelve (12) month period thereafter, as well as thesame twelve (12) month period in the past as contemplated in Section 4.A. of this Lease.     D. Definition of Rentable Square Feet. The term “Rentable Square Feet” as usedherein shall mean the area reasonably determined by Landlord on the basis of the actual RentableSquare Feet of the applicable portion of the Building, which shall be done through a measurement ofthe applicable portion of the Building once work is completed sufficiently so as to allow anaccurate physical measurement. The term “Rentable Square Feet” or “Rentable SquareFootage” shall mean the amount of square feet found within the applicable portion of theBuilding measured to the exterior surface of exterior walls and including the area underneathinterior walls and support columns. The parties agree that the Rentable Square Feet of the Buildingon the date of this Lease is 100,000 Rentable Square Feet.     2. RENT FOR FIRST YEAR OF PRIMARY TERM; RENT PAYMENTS: The rent payable for the originalPremises during the first Original Premises Lease Year shall be at the rate of Fifty-One ThousandFive Hundred and 00/100 Dollars ($51,500.00) per month, subject to adjustment in accordance withSection 3 below. All rent payable hereunder shall be paid to Landlord in lawful currency of theUnited States at such place as Landlord may from time to time designate in writing.     3. RENT INCREASES: The monthly rent for the original Premises shall be increased at thecommencement of each and every Original Premises Lease Year, with the first (1st)increase on the first (1st) day of the second (2nd) Original Premises LeaseYear in an amount equal to three percent (3%) of the monthly rental being paid in the immediatelyprior Original Premises Lease Year. Further, the aforementioned annual increases in monthly rentalshall also apply to the First Expansion Space, with each annual increase in monthly rental being inthe amount equal to three percent (3%) of the monthly rental being paid in the immediately priorFirst Expansion Lease Year, with the first (1st) increase on the first (1st)day of the second (2nd) First Expansion Lease Year. Similarly, the aforementioned annualincreases in monthly rental shall also apply to the Second Expansion Space, with each annualincrease in monthly rental being in the amount equal to three percent (3%) of the monthly rentalbeing paid in the immediately prior Second Expansion Lease Year, with the first (1st)increase on the first (1st) day of the second (2nd) Second Expansion LeaseYear. Finally, the aforementioned annual increases in monthly rental shall also apply to the rentfor the entire Premises (as then constituted, including any expansions to the Building) during anyOption Term of this Lease, with each annual increase in monthly rental being in the amount equal tothree percent (3%) of the monthly rental being paid in the immediately prior Lease Year, with thefirst (1st) increase on the first (1st) day of the second (2nd)Lease Year of each Option Term.     4. OPTION TO EXTEND AND RIGHT TO TERMINATE:     A. Option to Extend. Tenant shall have the option to extend this Lease for Two (2)additional Five (5) year term(s) (the “Option Terms”) upon the same conditions applicableto the Primary Term, except that (i) no additional options to extend shall be granted past November30, 2028, unless and only to the extent that the Primary Term is extended as provided in Section5.C. of this Lease, (ii) no additional rights to expand the Building shall be granted, and (iii)the rent
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during the first (1st) Lease Year of each Option Term shall be set at ninety-fivepercent (95%) of the Fair Market Rental Rate (as defined below), provided, however, that the rentduring the first (1st) Lease Year of each Option Term as determined above shall besubject to the following limitations: (x) the rent shall be no less than the rent paid in the LeaseYear that was four (4) Lease Years prior to the first (1st) Lease Year of the thenapplicable Option Term and be the sum of the rent paid for the total of the Original Premises and,if built, either or both the First Expansion Space and the Second Expansion Space, and (y) the rentshall be no more than one hundred three percent (103%) of the rent being paid during theimmediately prior Lease Year. Whenever the terms “Lease term” or “term of thisLease” are used in this Lease, they shall refer to the Primary Term and any Option Term forwhich Tenant has exercised its option to extend.     Tenant may exercise any option to extend this Lease by giving notice in writing to Landlordnot more than three hundred sixty (360) days and no less than two hundred seventy (270) days beforethe expiration of the Primary Term or any prior Option Term, as the case may be. Landlord covenantsand agrees to give Tenant written notice of the date by which such option must be exercised atleast forty-five (45) days but not more than one hundred twenty (120) days prior to when suchoption needs to be exercised (“Landlord’s Option Notice”). Tenant shall not be entitled toexercise any option to extend this Lease if Landlord’s Option Notice was given as required butTenant’s notice is not given as required herein or if the Tenant is in default of this Leasepursuant to Section 21 hereof beyond any applicable notice and cure period or grace period, or ifTenant has been ten (10) or more days late in payment of its rent and has not cured such latepayments within ten (10) days after written notice on more than three (3) occasions during anycalendar year of this Lease.     B. Fair Market Rental Rate. For the purposes of this Lease, the term “Fair MarketRental Rate” shall mean the annual amount per rentable square foot that a comparable landlordof a comparable building with a comparable vacancy factor has accepted in comparable transactionsbetween non-affiliated parties from new, non-expansion, non-renewal and non-equity tenants ofcomparable credit-worthiness, for comparable space, for a comparable use, for a comparable periodof time for the Dane County and Madison, Wisconsin metro market (“ComparableTransactions”). In any determination of Comparable Transactions appropriate consideration shallbe given to the annual rental rates per rentable square foot, the standard of measurement by whichthe rentable square footage is measured, the ratio of rentable square feet to usable square feet,the type of escalation clause, abatement provisions reflecting free rent, brokerage commissionswhich would be payable by Landlord in similar transactions, length of the lease term, size andlocation of premises being leased, tenant improvement allowances, and other generally applicableconditions of tenancy for such Comparable Transactions. No later than thirty (30) days afterLandlord has delivered Landlord’s Option Notice, Tenant shall notify Landlord of whether Tenant ispreliminarily planning on exercising its option to extend and directing the determination of theFair Market Rental Rate (“Tenant’s Preliminary Notice”). Within fifteen (15) business daysafter Tenant’s Preliminary Notice, Landlord shall notify Tenant in writing of Landlord’s good faithestimate of the Fair Market Rental Rate. Tenant shall, within ten (10) business days followingreceipt of same, notify Landlord in writing of the acceptance or rejection of the proposed FairMarket Rental Rate, which notice shall include, if Tenant objects to Landlord’s determination,Tenant’s own determination of the Fair Market Rental Rate. If Tenant fails to respond within suchperiod, then Tenant shall be deemed to have rejected
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Landlord’s determination of the Fair Market Rental Rate as set forth in Landlord’s notice. In theevent Tenant objects by timely providing written notice to Landlord (or is deemed to have rejectedsuch determination), Landlord and Tenant shall attempt to agree upon such Fair Market Rental Rateusing good faith efforts. If Landlord and Tenant fail to reach agreement within fifteen (15)business days following Tenant’s delivery of its objection to (or deemed rejection of) Landlord’sFair Market Rental Rate (the “Outside Agreement Date”), then such determination shall bedetermined in accordance with the immediately following paragraph.     Within five (5) business days after the Outside Agreement Date, Landlord and Tenant shall eachappoint an impartial, reputable, licensed real estate broker who has been active in leasingbuildings similar to the Premises in the Madison, Wisconsin metro market during theimmediately-preceding five (5) year period (a “Qualified Broker”). Each of the twoQualified Brokers shall then, within thirty (30) days after their appointment determine the FairMarket Rental Rate for the Premises (based on the criteria identified in the first paragraph ofthis Section 4.B. above) and deliver the results to each of Landlord and Tenant. In the event thatthe higher of the two determinations is 5% or less different than the lower of the twodeterminations then the Fair Market Rental Rate shall be the average (mean) of the two. In theevent that the higher of the two determinations is greater than 5% different than the lower of thetwo determinations then the two Qualified Brokers shall, within five (5) business days after thelast of the two Qualified Broker determinations is delivered, select a third Qualified Broker, whoshall, within ten (10) Business Days after his or her appointment decide which of the two QualifiedBroker determinations is the appropriated determination of the Fair Market Rental Rate based on thecriteria identified in the first paragraph of this Section 4.B. above. Landlord and Tenant shalleach pay any fees for the services of the Qualified Broker retained by them and for one-half of thefees for the third Qualified Broker.     C. Right to Terminate. Subject to the terms of this Section, Tenant shall have theright to terminate this Lease in advance of the expiration of the Primary Term of this Leaseeffective at anytime after the last day of the seventy-eighth (78th) month following theRent Commencement Date. Tenant’s right to terminate this Lease pursuant to this Section may only beexercised if all of the following requirements are satisfied: (i) Tenant is not at that time indefault with respect to any of the terms and provisions of this Lease and has not subsequentlydefaulted in any of Tenant’s obligations under this Lease past any applicable cure period throughthe effective date of the early termination, (ii) Tenant has not provided an Expansion Notice toLandlord for the Second Expansion Option, (iii) Tenant delivers a written notice to Landlordnotifying Landlord that Tenant is terminating this Lease pursuant to this Section, which noticeshall be provided at least eighteen (18) months before the proposed date of termination pursuant tothis Section, and (iv) along with the foregoing described written notice to Landlord Tenant shalldeliver to Landlord a termination fee in the amount of the following, as applicable, (a) if Tenanthas not provided an Expansion Notice to Landlord for the First Expansion Option, the terminationfee shall be an amount equal to the unamortized portion of the real estate brokerage commissionpaid by Landlord to CresaPartners — West, Inc. (“CresaPartners”) in connection with thisLease (with the commission being amortized on a straight line basis over the Primary Term and thecalculation of the unamortized amount shall be performed on a per day basis), or (b) if Tenant hasprovided an Expansion Notice to Landlord for the First Expansion Option, the termination fee shallbe the sum of the following amounts (x) the unamortized portion of the real estate brokeragecommission paid by Landlord to CresaPartners in connection with this Lease
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(with the commission being amortized on a straight line basis over the Primary Term and thecalculation of the unamortized amount to be performed on a per day basis), plus (y), theunamortized portion of the real estate brokerage commission paid by Landlord to CresaPartners (orits successors and/or assigns) in connection with the expansion into the First Expansion Space(with the commission being amortized on a straight line basis over the period commencing on thedate that Tenant starts paying rent for the First Expansion Space and ending on the last day of thePrimary Term, and the calculation of the unamortized amount to be performed on a per day basis),and plus (z) the unamortized portion of the First Expansion Tenant Improvement Amount (with theFirst Expansion Tenant Improvement Amount being amortized over the period commencing on the datethat Tenant starts paying rent for the First Expansion Space and ending on the last day of theseventy-eighth (78th) month following the date that Tenant starts paying rent for theFirst Expansion Space, and the calculation of the unamortized amount to be performed on a monthlybasis, as described below). The term “First Expansion Tenant Improvement Amount” shall meanthe amount equal to fifteen dollars ($15) times the Rentable Square Feet of the First ExpansionSpace with the unamortized amount outstanding accruing interest at the rate of seven percent (7%)per annum with the calculation of interest assuming that the amortized portions are reduced fromthe unamortized portions along with interest on a monthly basis. For example, with respect to theFirst Expansion Tenant Improvement Amount, if Tenant occupied 20,000 Rentable Square Feet throughthe First Expansion Option on the first day of the second Original Premises Lease Year andterminates this Lease on the last day of the sixth (6th) Original Premises Lease Year,the unamortized amount of the First Expansion Tenant Improvement Amount would be $28,210.70 ($15 x20,000 = $300,000 amortized over seventy-eight (78) months at 7% interest results in $28,210.70remaining unamortized at the end of the seventh (7th) Original Premises Lease Year, assuch calculations are shown in more detail on Exhibit D attached hereto).     5. OPTION TO EXPAND.     A. Expansion Notice. Subject to the First Expansion Conditions and the SecondExpansion Conditions (as defined below and as applicable), if Tenant desires to expand the Buildingfor either of the expansion options contemplated herein, then Tenant shall provide a writtenrequest to Landlord (the “Expansion Notice”), which written notice shall contain theapproximate size (in Rentable Square Feet) of the expansion desired by Tenant and the desiredoccupancy date for such space, provided, however, that such occupancy date shall be no earlier thantwelve (12) months after the date the Expansion Notice is delivered by Tenant to Landlord. Tenantmay not revoke an Expansion Notice once delivered to Landlord.     B. First Expansion Option. Subject to the First Expansion Conditions, Tenant shallhave the right to have Landlord expand the Building’s square footage for Tenant to Lease through anexpansion of no less than 20,000 Rentable Square Feet and not to exceed 60,000 Rentable Square Feet(provided, however, that the original Building and all expansions, including those still to becompleted, taken together shall not to exceed 200,000 Rentable Square Feet) with a completion dateto be provided by Tenant (subject to the minimum time for construction as provided in Section 5.A.above), provided that the Expansion Notice is provided by Tenant to Landlord no later than the lastday of the thirtieth (30th) month after the Rent
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Commencement Date (the “First Expansion Option”). The Lease terms applicable to the FirstExpansion Option, if exercised, will be as follows:          (i) Planning and Construction. The approximate location of First ExpansionOption space is shown on Exhibit E attached hereto. Within fifteen (15) days afterTenant provides its Expansion Notice, the parties shall meet to discuss the details of theexpansion and Tenant agrees to participate in any subsequent meetings requested by Landlordin order for final plans and specifications to be developed for the First Expansion Optionspace, which plans and specifications shall be approved by both Landlord and Tenant. TheFirst Expansion Option space, once finally determined as to the size and location, ishereinafter referred to as the “First Expansion Space.” In developing the scope ofwork to be performed by Landlord for the First Expansion Space, it is acknowledged that theFirst Expansion Space shall only be developed for production and warehouse space and thatthe ratio of the production and warehouse space shall be on a 50%/50% basis (unlessotherwise mutually agreed by the parties in writing), and that the scope of Landlord’s workshall be to a level of fit and finish consistent with that which is necessary to supportTenant’s permitted use, including without limitation, all elements of utility, power, HVAC,fire protection, and plumbing, and shall not exceed the scope of work as outlined onExhibit F attached hereto. For the avoidance of doubt, Landlord shall bear all costsassociated with the First Expansion Space, including without limitation construction,materials, architecture and engineering costs. Any additional work required for Tenant’s useof the First Expansion Space shall be performed at Tenant’s sole cost and expense. Tenantshall have the right, at Tenant’s own cost and expense, to engage its own space planner andany engineers and/or consultants of its choice, subject to Landlord’s reasonable approval,to prepare preliminary space plans and working drawings. Subject to Permitted Delays (asdefined below) and the minimum time for construction as provided in Section 5.A. above,Landlord shall Substantially Complete the First Expansion Space within the time periodprovided in Tenant’s Expansion Notice.          (ii) Term. Provided that Tenant’s Expansion Notice is timely provided toLandlord, the Term of this Lease shall not be affected by Tenant’s exercise of the FirstExpansion Option. The Term for both the Original Premises and the First Expansion Spaceshall expire or be extended together (and may not be separated), unless this Lease isterminated early as provided in Section 4.C. of this Lease.          (iii) Rent. Tenant shall commence paying rent for the First Expansion Space onthe date that is thirty (30) days after Substantial Completion of the First Expansion Space(the “First Expansion Rent Commencement Date”). The rent amount for the first FirstExpansion Lease Year (as defined in Section 1.C. of this Lease) shall be based on thefollowing:     a. If Tenant provides its Expansion Notice during the first Original PremisesLease Year and with a scheduled Substantial Completion date no later than twelve(12) months after the date the Expansion Notice is provided, then the annual rent(payable in twelve (12) equal monthly installments) for the First
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Expansion Space for the First Expansion Lease Year will be Six and 61/100 ($6.61) times theRentable Square Feet of the First Expansion Space. For the avoidance of doubt, the annual rent forthe First Expansion Lease Year shall be as set forth in the preceding sentence even if the actualSubstantial Completion date occurs after the scheduled Substantial Completion date.     b. If Tenant provides its Expansion Notice within the second (2nd) OriginalPremises Lease Year and with a scheduled Substantial Completion date no later than twelve (12)months after the date the Expansion Notice is provided, then the annual rent (payable in twelve(12) equal monthly installments) for the First Expansion Space for the First Expansion Lease Yearwill be Six and 81/100 ($6.81) times the Rentable Square Feet of the First Expansion Space. For theavoidance of doubt, the annual rent for the First Expansion Lease Year shall be as set forth in thepreceding sentence even if the actual Substantial Completion date occurs after the scheduledSubstantial Completion date.     c. If Tenant provides its Expansion Notice within the third (3rd) Original PremisesLease Year, but in no event may such Expansion Notice be provided later than the last day of thethirtieth (30th) month after the Rent Commencement Date, and with a scheduledSubstantial Completion date no later than twelve (12) months after the date the Expansion Notice isprovided, then the annual rent (payable in twelve (12) equal monthly installments) for the FirstExpansion Space for the First Expansion Lease Year will be Seven and 01/100 ($7.01) times theRentable Square Feet of the First Expansion Space. For the avoidance of doubt, the annual rent forthe First Expansion Lease Year shall be as set forth in the preceding sentence even if the actualSubstantial Completion date occurs after the scheduled Substantial Completion date.     d. If Tenant provides its Expansion Notice at any time before the last day of the thirtieth(30th) month after the Rent Commencement Date, but Tenant’s scheduled SubstantialCompletion is more than twelve (12) months after the date the Expansion Notice is provided(however, in no event will Tenant have the right to expand pursuant to the First Expansion Optionwith an anticipated Substantial Completion date later than the last day of the forty-second(42nd) month after the Rent Commencement Date), then the annual rent (payable in twelve(12) equal monthly installments) for the First Expansion Space for the First Expansion Lease Yearwill be (1) Six and 61/100 ($6.61) times the Rentable Square Feet of the First Expansion Spacewhere the scheduled Substantial Completion date is during the second (2nd) OriginalPremises Lease Year, (2) Six and 81/100 ($6.81) times the Rentable Square Feet of the FirstExpansion Option Space where the scheduled Substantial Completion date is during the third(3rd) Original Premises Lease Year, (3) Seven and 01/100 ($7.01) times the RentableSquare Feet of the First Expansion Space where the scheduled Substantial Completion date is duringthe fourth (4th) Original Premises Lease Year. For the avoidance of doubt, the annualrent for the First Expansion Lease Year shall be as set forth in the
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preceding sentence even if the actual Substantial Completion date occurs after thescheduled Substantial Completion date.Exhibit C attached hereto provides an example of the rent payments described herein,assuming that the Expansion Notice is provided by Tenant for the First Expansion Option on the lastday of the second (2nd) Original Premises Lease Year, the First Expansion Space is30,000 Rentable Square Feet, and the First Expansion Rent Commencement Date is the first(1st) day of the fourth (4th) Original Premises Lease Year.          (iv) Substantial Completion and Occupancy. The Term “Substantial Completion”shall mean the stage of construction of the First Expansion Space such that (1) a certificate ofoccupancy (permanent or temporary) has been issued from the local municipality for the FirstExpansion Space, (2) all material building systems are in good working order such that Tenant canoperate its business from the First Expansion Space, and (3) only industry standard punch listitems are left to be completed. During the thirty (30) day period between the date of SubstantialCompletion and the First Expansion Rent Commencement Date, Tenant shall have the right occupy theFirst Expansion Space and to move in and install, at Tenant’s sole cost and expense, Tenant’sfurniture, fixtures, trade fixtures, personal property, and telecommunications wiring andequipment.          (v) Amendment to Lease. Once all of the plans and specifications are finalized for theFirst Expansion Space, Landlord and Tenant shall prepare in good faith and enter into an Amendmentto this Lease documenting the exact size and location of the First Expansion Space, the rent to bepaid upon Substantial Completion and such other matters as may be necessary and/or appropriate indocumenting the expansion, provided, however, that no such other provisions shall be inconsistentwith the terms of this Lease.          (vi) First Expansion Conditions. Unless a Lease Amendment is fully signed by bothLandlord and Tenant documenting the expansion pursuant to the First Expansion Option, then Tenant’sright to expand into the First Expansion Space pursuant to this Section 5.B. of the Lease shall besubject to the following conditions precedent (the “First Expansion Conditions”): (1)Tenant’s Expansion Notice must be provided before the last day of the thirtieth (30th)month after the Rent Commencement Date, (2) Tenant must specify an anticipated SubstantialCompletion date no later than the last day of the forty-second (42nd) month after theRent Commencement Date, subject to the minimum time for construction as provided in Section 5.A.above, (3) this Lease must be in full force and effect and Tenant may not be in default of thisLease (beyond any applicable cure period) at the time the Expansion Notice is provided nor mayTenant subsequently default in any of Tenant’s obligations under this Lease past any applicablecure period, and (4) Tenant must sign an Amendment to the Lease to document the expansion into theFirst Expansion Space within forty-five (45) days after the Expansion Notice is provided by Tenant.If any one or more of the First Expansion Conditions are not met, at Landlord’s reasonable option,Tenant’s Expansion Notice shall be invalid and Tenant’s right to expand pursuant to said ExpansionNotice shall be null and void and be of no further force and effect.
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     C. Second Expansion Option. Following the Rent Commencement Date and continuing untilthe last day of the Primary Term of this Lease, and subject to the Second Expansion Conditions (asdefined below), Tenant shall have the right to have Landlord expand the Building’s square footagefor Tenant to Lease through an expansion of Building to up to a total Building size (the originalBuilding and all expansions, including those still to be completed, taken together) not to exceed200,000 Rentable Square Feet with a completion date to be provided by Tenant (subject to theminimum time for construction as provided in Section 5.A. above) (the “Second ExpansionOption”). The Lease terms applicable to the Second Expansion Option, if exercised, will be asfollows:          (i) Planning and Construction. The approximate location of Second ExpansionOption space is shown on Exhibit G attached hereto. Within fifteen (15) days afterTenant provides its Expansion Notice, the parties shall meet to discuss the details of theexpansion and Tenant agrees to participate in any subsequent meetings requested by Landlordin order for final plans and specifications to be developed for the Second Expansion Optionspace, which plans and specifications shall be approved by both Landlord and Tenant. TheSecond Expansion Option space, once finally determined as to the size and location, ishereinafter referred to as the “Second Expansion Space”. Landlord agrees tocompetitively bid the construction of the Second Expansion Space using subcontractorsapproved by Tenant, which approval shall not be unreasonably withheld or delayed. For theavoidance of doubt, Landlord shall bear all costs associated with the Second ExpansionSpace, including without limitation construction, materials, architecture and engineeringcosts. Tenant shall have the right, at Tenant’s own cost and expense, to engage its ownspace planner and any engineers and/or consultants of its choice, subject to Landlord’sreasonable approval, to prepare preliminary space plans and working drawings. Subject toPermitted Delays (as defined below) and the minimum time for construction as provided inSection 5.A. above, Landlord agrees to Substantially Complete the Second Expansion Spacewithin the time period provided in Tenant’s Expansion Notice.          (ii) Term. If Tenant expands the Building for Tenant pursuant to the SecondExpansion Option, then the Primary Term of this Lease shall be no less than seventy-eight(78) months commencing on the anticipated date of Substantial Completion of the SecondExpansion Space, and such extended Primary Term may only end on the last day of a month. Ifthe Primary Term of this Lease will be less than seventy-eight (78) months on theanticipated date of Substantial Completion of the Second Expansion Space, then the PrimaryTerm shall be extended so that the Primary Term is extended to expire on the last day of theseventy-eighth (78th) month following the anticipated date of SubstantialCompletion of the Second Expansion Space. Further, if Tenant’s anticipated SubstantialCompletion date included in its Expansion Notice is earlier than the last day of the fifth(5th) Original Premises Lease Year, than the Primary Term shall be extended toexpire on the last day of the seventy-eighth (78th) month following the first dayof the fifth (5th) Original Lease Year. The Term for both the Original Premisesand, if built, either or both of First Expansion Space and the Second Expansion Space shallexpire or be extended together (and may not be separated). If Tenant expands the Building
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pursuant to the Second Expansion Option, Tenant’s right to terminate this Lease pursuant to Section4.C. of this Lease shall be null and void (no longer available for Tenant to exercise) on the datethat Tenant provides is Expansion Notice for the Second Expansion Option.          (iii) Rent. Tenant shall commence paying rent for the Second Expansion Space on thedate that is thirty (30) days after Substantial Completion of the Second Expansion Space (the“Second Expansion Rent Commencement Date”). The annual rent amount (payable in twelve (12)equal monthly installments) for the first (1st) Second Expansion Lease Year (as definedin Section 1.E. of this Lease) shall be determined based upon the total amount of all of Landlord’sProject Costs (as defined below) multiplied by nine and one-quarter percent (9-1/4%). The term“Landlord’s Project Costs” shall mean all of the following Landlord’s costs, expenses andfees in constructing the Second Expansion Space: (a) the following hard and soft costs (the“Hard and Soft Costs”) (1) all architectural and engineering fees, (2) permits andapprovals costs and fees, and third party consulting fees, (3) construction costs, includingdemolition costs, (4) grading, storm water management and landscaping costs, (5) costs in expandingthe parking lot, (6) inspection and plan checking fees, (7) attorneys’ fees and costs, (8)insurance costs, (9) loan fees and costs, and construction interest costs, (10) real estatebrokerage fees paid to CresaPartners (or its successors or assigns), if any, (11) costs for anon-site job superintendant paid to the general contractor, and (12) any other actual out-of-pocketcosts incurred by Landlord in connection with constructing the Second Expansion Space, as well as(b) the following fees as a percentage of the Hard and Soft Costs (1) a general contractors fee inthe amount equal to ten percent (10%) of the sum of all Hard and Soft Costs, and (2) a developmentfee payable to Landlord in the amount equal to five percent (5%) of the sum of all the Hard andSoft Costs. Landlord’s Project Costs shall be provided to Tenant on an open-book basis. Tenantshall have the right to engage its own project manager, at Tenant’s own cost and expense.Exhibit C attached hereto provides an example of the rent payments and the extension of thePrimary Term assuming that the Expansion Notice is provided by Tenant for the Second ExpansionOption on the last day of the fifth (5th) Original Premises Lease Year, Landlord’sProject Costs for the Second Expansion Space equaled $5,600,000, and the Second Expansion RentCommencement Date is the first (1st) day of the Seventh (7th) OriginalPremises Lease Year.          (iv) Substantial Completion and Occupancy. The Term “Substantial Completion”shall mean the stage of construction of the Second Expansion Space such that (1) a certificate ofoccupancy (permanent or temporary) has been issues from the local municipality for the SecondExpansion Space, (2) all material building systems are in good working order such that Tenant canoperate its business from the Second Expansion Space, and (3) only industry standard punch listitems are left to be completed. During the thirty (30) day period between the date of SubstantialCompletion and the Second Expansion Rent Commencement Date, Tenant shall have the right occupy theSecond Expansion Space and to move in and install, at Tenant’s sole cost and expense,
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Tenant’s furniture, fixtures, trade fixtures, personal property, and telecommunicationswiring and equipment.          (v) Amendment to Lease. Once all of the plans and specifications are finalizedfor the Second Expansion Space, Landlord and Tenant shall prepare in good faith and enterinto an Amendment to this Lease documenting the exact size and location of the SecondExpansion Space, the rent to be paid upon Substantial Completion and such other matters asmay be necessary and/or appropriate in documenting the expansion, provided, however, that nosuch other provisions shall be inconsistent with the terms of this Lease.          (vi) Second Expansion Conditions. Unless a Lease Amendment is fully signed byboth Landlord and Tenant documenting the expansion pursuant to the Second Expansion Option,then Tenant’s right to expand into the Second Expansion Space pursuant to this Section 5.C.of the Lease shall be subject to the following conditions precedent (the “SecondExpansion Conditions”): (1) Tenant’s Expansion Notice must be provided after the RentCommencement Date and no later than before the last day of the original Primary Term, (2)this Lease must be in full force and effect and Tenant may not be in default of this Leasebeyond any applicable cure period at the time of the Expansion Notice is provided nor mayTenant subsequently default in any of Tenant’s obligations under this Lease past anyapplicable cure period, and (3) Tenant must sign an Amendment to the Lease to document theexpansion into the Second Expansion Space within forty-five (45) days after the ExpansionNotice is provided by Tenant. If any one or more of the Second Expansion Conditions are notmet, at Landlord’s reasonable option, Tenant’s Expansion Notice shall be invalid andTenant’s right to expand pursuant to said Expansion Notice shall be null and void and be ofno further force and effect.     D. Construction Methods and Warranties. Subject to the terms of the limited warrantyprovided below, Landlord’s work in constructing the First Expansion Space and the Second ExpansionSpace, as applicable, shall be performed in a good and workmanlike manner and in accordance withindustry standards for similar buildings in the Madison, Wisconsin metro market. Landlord shall beresponsible for all costs related to the compliance with all applicable current building codes, aswell as the Americans with Disabilities Act of 1990 as they relate to the First Expansion Space andthe Second Expansion Space, as applicable. Landlord shall warrant, for a period of one (1) yearafter Substantial Completion (or assign any additional or longer period warranties to Tenant), thatthe roof, HVAC system equipment, windows and seals, structural components, and all electrical andplumbing systems and equipment are in good working condition, except that Tenant shall beresponsible for regular maintenance of the same. The warranty provided in the immediately precedingsentence is limited to the matters described in the foregoing sentence and is provided in lieu ofall other warranties or guaranties provided by Landlord. Notwithstanding the terms of this Section,in the event Tenant or its employees, contractors, agents or invitees causes any damage to portionsof the Building or Premises covered by the above-described warranty, Tenant shall repair suchdamage at Tenant’s cost.     E. Permitted Delays. The term “Permitted Delays” as used herein shall meandelays in Landlord’s work toward Substantial Completion of the First Expansion Space and the Second
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Expansion Space, as applicable, caused by any of the following: (i) delays caused by Tenant, and/or(ii) act of God, war, insurrection, riot, civil commotion, fire or other casualty, strikes,lockouts, inclement weather, inability to obtain labor or materials, governmental regulations, orother causes beyond Landlord’s reasonable control. A delay shall not constitute a Permitted Delayunless Landlord provides Tenant with written notice within ten (10) business days after the passageof such delay, describing in reasonable detail the cause of the delay and the expected completiondate. In event of a Permitted Delay, Landlord shall use commercially reasonable efforts to mitigatethe effect and duration of such Permitted Delay and resume work toward Substantial Completion assoon as reasonably practicable.     F. Certain Items of Tenant’s Work. Tenant, at Tenant’s expense, shall have the rightto install security systems in the First Expansion Space and the Second Expansion Space includingcard key and CCTV systems, provided, however, the location, design and operation of such systemsshall be approved by Landlord, which approval shall not be unreasonably withheld, conditioned ordelayed. Tenant shall have the right to install up to two (2) communications antennas on thePremises. Said antennas may be installed on the roof of the Building, or in another locationapproved by Landlord. Tenant shall have the right to trench to any antennas that are not installedon the Building’s rooftop. Tenant shall appropriately screen any installed antennas.     G. Parking. Landlord’s work in constructing the First Expansion Space and the SecondExpansion Space shall include the expansion of the parking lot on the Premises so that the ratio oftotal parking stalls servicing the Building is no less than two and one-half (2-1/2) stalls per1,000 square feet of Rentable Square Feet in the Building.     6. USE OF PREMISES; COMPLIANCE WITH LAW: The Premises (and any expansion spaces once occupiedby Tenant) shall be used and occupied for the purpose of manufacturing, warehousing and generaloffice purposes and for purposes incidental to such use and occupancy and for no other purposeswhatsoever without Landlord’s prior consent. Tenant shall at its own expense obtain any and allgovernmental approvals, licenses and permits necessary for Tenant’s use. Tenant shall not commitwaste or suffer or permit waste to be committed in, on or about the Premises.     Tenant shall comply with all governmental laws, ordinances and regulations (includingEnvironmental Laws as hereinafter defined) applicable to the Premises or its use of the Premisesand shall promptly comply with all governmental orders and directives applicable to the Premises,its use of the Premises or connected with the Premises all at Tenant’s sole expense (except formatters that are Landlord’s responsibility as set forth in the following sentence). Provided,however, that Landlord warrants and represents that as of the Rent Commencement Date with respectto the Premises, and as of the date of Substantial Completion with respect to each of the expansionspaces, (i) the Building and Tenant’s use of the Premises (referenced above) comply with allbuilding and use restrictions affecting the Premises, including applicable zoning and land uselaws, (ii) that Landlord has neither granted nor consented to easements or other encumbrances thatwould adversely affect or impair Tenant’s use of the Premises and (iii) that Building wasconstructed in compliance with all applicable laws, rules, regulations and orders including,without limitation, the Americans With Disabilities Act and any Wisconsin
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counterparts protecting the rights of the disabled as modified or amended prior to construction.Landlord’s obligation to comply with the Americans With Disabilities Act and its Wisconsincounterpart shall be based upon the information as to Tenant’s use which Tenant has provided toLandlord prior to the execution of this Lease.     7. PROPERTY TAXES: Tenant shall pay, in addition to all other sums required to be paid by itunder the provisions of this Lease, and notwithstanding any protest planned or pending, all RealProperty Taxes which may be taxed, charged, assessed, levied or imposed at any time or from time totime on the Premises (including those relating to the expanded Building) attributable to the Leaseterm. In addition to the rent payable hereunder, Tenant shall on the first day of each monthcommencing with the first day of the month following the Rent Commencement Date pay to Landlordone-twelfth (1/12th) of the estimated (by the Village of Deerfield) Real Property Taxes for thethen current tax year. When real estate taxes are paid by Landlord, any excess paid by Tenant shallbe credited towards its liability for future real estate taxes or, if the Lease term has ended,refunded to Tenant within ten (10) days of determination that an excess amount has been paid. Anyshortage shall be billed to Tenant by Landlord and shall be paid by Tenant within thirty (30) daysof such billing.     As between the parties hereto, Tenant alone shall, at its sole and absolute discretion, havethe duty of attending to the making and filing of any statement or report which may be provided orrequired by law as a basis of or in connection with the determination, equalization, reduction,payment or abatement of each obligation which is to be borne or paid by Tenant in accordance withthis Section. Landlord shall not be or become responsible therefor, nor for the contents of anysuch statement or report. Unless required by law for a successful action to be brought or claim tobe made, Landlord shall not be obligated to make, join in or be a party to any protest or objectionto any law, order, proceeding or determination, but shall cooperate and join with Tenant to theextent required by law, provided the Tenant agrees to reimburse Landlord’s actual out-of-pocketexpenses incurred in connection therewith.     Landlord agrees to provide Tenant, within ten (10) days of Landlord’s receipt, with true andcomplete copies of all Real Property Tax bills, tax notices or assessments which Landlord receivesrelating to the Premises.     As used in this Section 7, “Real Property Tax” includes any real estate taxes, specialassessments (but only installments falling due during the Lease term and which shall be paid overthe longest period allowed) and similar levies and charges against this Lease, the Premises (andall improvements thereon) or the occupancy, use or possession thereof, or any estate, right titleor interest of Landlord, Tenant or either of them in or to the Premises. “Real PropertyTax” does not, however, include Landlord’s federal or state income, franchise, inheritance orestate taxes.     Landlord warrants and represents that there are no special assessments or similar levies orcharges currently outstanding affecting the Premises nor does Landlord have notice or knowledge ofany improvements either currently underway or planned which could result in the imposition of anyspecial assessment or similar levies or charges. If any sales tax shall be imposed on the rentals,Tenant and not Landlord shall pay the same.
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     Tenant shall be responsible for paying any and all personal property taxes which may be leviedagainst Tenant’s property.     8. INSURANCE: Tenant shall obtain and maintain in full force and effect at its expense duringthe term of this Lease, a comprehensive general liability policy (or policies) satisfactory toLandlord, covering the Premises (and any expanded portion of the Building starting on the date thatTenant first occupies the same) and naming Landlord, Tenant and Landlord’s mortgagee(s) asinsureds. Such policy (or policies) shall insure against injury to property, persons or loss oflife arising out of the use or occupancy of the Premises with a combined single occurrence limitnot less than One Million Dollars. Said insurance shall be written on an “occurrence” and not on a“claims made” basis. All such liability policies will require at least thirty (30) days notice toLandlord of cancellation. Tenant shall furnish Landlord a copy (or copies) of such policy (orpolicies), or certificate(s) thereof, indicating such coverage is in effect. If Tenant shall failto maintain such insurance in full force and effect, or shall fail to present the requiredcertificate or copy of policy (or policies), Landlord may at its option and with at least fifteen(15) business days advance written notice to Tenant and opportunity to cure, obtain the necessaryinsurance, pay the premium and the premium shall be repaid to Landlord as additional rent for themonth following the date on which the premium was paid by Landlord. Tenant shall during the term ofthis Lease procure and maintain, at Tenant’s expense, a “special form” policy (or policies) ofinsurance providing special perils, all-risks, fire and extended coverage on the buildings andimprovements now or hereafter located on the Premises in an amount equal to the full replacementvalue thereof above foundation, and against loss by boiler explosion in an amount reasonably deemedadequate by Landlord. Tenant shall also procure and maintain coverage for loss of rental under abusiness interruption policy (or policies) including extra expense covering loss of rent in theamount of the full rental agreed to be paid by Tenant hereunder for a period of one (1) year.Landlord’s mortgagee shall be covered as insured mortgagee. Landlord or Landlord’s mortgage, asdirected by Landlord, shall be named as the loss payee for insurance coverage for the buildings andimprovements. Tenant covenants and agrees to provide Landlord, upon request, with a copy of theinsurance policy and to also provide Landlord on an annual basis with evidence of such coveragecontinuing in place. All insurance coverages provided hereunder shall be approved by Landlord.Landlord shall at least annually provide Tenant with certificates of all insurance it maintains inconnection with the Premises or the Building. Tenant shall be solely responsible for obtaininginsurance as it may deem advisable for all of its contents and merchandise located in the Premisestogether with coverage for any fixtures, equipment or work done by Tenant including leaseholdimprovements. It is understood that any insurance carried by Landlord does not cover the risk ofloss or damage to Tenant’s property, equipment or fixtures nor property of others which may bestored in the Premises by Tenant. Tenant waives any claim against Landlord for such loss and shallsave Landlord harmless from any claim for loss or damage to contents, merchandise, fixtures or workdone by Tenant regardless of the cause of such damage or loss, unless it results from a negligentact or omission or willful misconduct of Landlord or its agents, employees or invitees.     9. USE AND EXTERIOR MAINTENANCE BY TENANT: Landlord covenants and agrees that, as part of anyexpansion of the Building as described in this Lease, it will initially landscape the unimprovedportion of the Premises and shall initially develop the parking
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areas and sidewalks as shown in the plans and specifications for such an expansion. Tenant shallmaintain all areas of the Premises and the Building (as constituted from time-to-time) in goodorder, condition and repair, except as noted in Sections 5.D and 10 of this Lease, and shall bearall costs associated therewith including, but not limited to costs resulting from lawn mowing, snowremoval, landscaping, painting, lighting, cleaning, rubbish removal, security and similar items.Landlord shall make available to Tenant all warranties received by Landlord from parties furnishingservices or materials in connection with the construction of the Landlord Improvements. Except asspecifically provided in Sections 5.D. and 10 of this Lease, it is the stated purpose and intent ofLandlord and Tenant that this Lease shall be absolutely net (also referred to as triple net) toLandlord and that Tenant shall pay, at the times and in the manner provided in this Lease, allcosts associated with the use, occupancy, repair and maintenance of the Premises and Building, andall such payments shall be without deduction or set off of any kind.     10. MAINTENANCE BY LANDLORD: Landlord at its expense shall maintain the foundation, exteriorwalls (including, without limitation, the window assembly, but excluding glass breakage) and roofof the Building in good order and repair throughout the term on the Lease. Landlord shall alsomaintain the parking lot (excluding snow plowing, which is Tenant’s responsibility) on the Premisesuntil such time as the parking lot is completely resurfaced (and may also be expanded), which mayoccur at any time, but is most likely to occur at the time of the first expansion of the Buildingas contemplated in this Lease. Commencing on the date of the substantial completion of theresurfacing of the parking lot and for the remainder of the term of this Lease, including anyextended periods, Tenant shall be responsible for maintaining and keeping in good repair theparking lot. Notwithstanding the foregoing, in the event Tenant or its employees, contractors,agents or invitees causes any damage to the portions of the Premises to be maintained by Landlord,Tenant shall repair such damage at Tenant’s cost.     11. MAINTENANCE BY TENANT: Commencing on the Rent Commencement Date and for the remainder ofthe term of this Lease, including any extended periods, Tenant shall at its expense maintain theinterior of the Building in good order and repair including, but not limited to repairs to orrequired replacements of the interior plumbing, windows glass, plate glass doors and any heating,ventilating and air conditioning equipment serving the Building. Tenant shall also be responsiblefor snow removal, grass mowing and landscaping maintenance, as well as for janitorial services.     12. ALTERATIONS, ADDITIONS AND IMPROVEMENTS: Tenant shall not make any alterations, additionsor improvements to the Premises without prior written consent of the Landlord unless the costtherefor would not exceed Ten Thousand Dollars ($10,000) per occurrence; *provided, however,*thatTenant shall not need Landlord’s approval if alterations, additions and improvements are less than$3.00 per RSF, are non-mechanical, non-structural, non-electrical, not visible from the exterior ofthe building, and do not adversely affect the value of the building. Notwithstanding the foregoing,Tenant may perform cosmetic work such as painting, installing carpet and low-voltage cablingwithout Landlord’s consent but with prior notice. Upon the expiration of the Lease term, all suchalterations, additions and improvements shall become the property of the Landlord. However, Tenantshall have the right to remove such alterations, additions, or improvements upon the termination ofthe Lease, provided that Tenant
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shall repair any damage caused by such removal and shall restore the appearance of the Premises byredecorating. Landlord may elect upon notice to Tenant (which shall be provided no later than thetime Landlord provides its consent to Tenant to make such improvements or within thirty (30) daysafter the expiration or early termination date of this Lease if Tenant did not obtain Landlord’swritten consent to such an improvement) to require the removal of all alterations, additions orimprovements that require Landlord’s consent pursuant to this paragraph upon the expiration ortermination of the Lease, in which case Tenant shall promptly remove the said alterations,additions and improvements and repair the damage caused by such removal.     13. SIGNS: Tenant shall have the right to erect such signs on the Building and Premises as areconsistent with governmental rules and regulations applicable to the Premises. Any signs erected byTenant shall be removed upon the termination of the Lease. Tenant shall repair any and all damagecaused by such removal and shall restore the appearance of the Premises by redecorating.     14. INCREASED PREMIUMS/SUSPENSION OF INSURANCE: Tenant shall not permit the Premises to beused in a manner which would cause the suspension or cancellation of fire or extended coverageinsurance or the liability insurance policy carried by Tenant for the benefit of Landlord andTenant. Tenant shall promptly notify Landlord of any changes in its use of the Premises beyond theuse stated in Section 6 and any corresponding change in insurance coverage or premiums, and shallpromptly pay any increased insurance premium and immediately provide proof thereof to Landlord.     15. WAIVER OF SUBROGATION: To the extent permitted by their respective policies of insurance,each party waives any claim which may arise against the other party during the term of this Leasefor loss or damage to any of its property located within or upon or constituting a part of thePremises which loss or damage is (i) covered by valid and collectable fire and extended coverageinsurance policies to the extent that such loss or damage is recoverable under said insurancepolicies or (ii) is required hereunder to be covered by such policy (or policies). These mutualwaivers are intended to preclude any subrogation claim by the insurer for either party against theother party. Each party agrees to have its insurance policies properly endorsed if necessary toprevent the invalidation of said insurance coverage by reason of said waivers.     16. LANDLORD’S RIGHT OF ENTRY: Upon reasonable notice to Tenant (or without notice if anemergency exists) and in a manner that minimizes disruption to Tenant and the business, Landlordand its agents shall have the right to enter the Premises during ordinary business hours for thepurpose of inspecting the Premises, making repairs, or showing the Premises to prospectivepurchasers, lenders or for other reasonable purposes. An emergency exists if material damage wouldbe caused to the Premises if immediate action was not taken. Within two hundred seventy (270) daysprior to the expiration of the Lease term or within one hundred eighty (180) days prior to theearly termination date of the Primary Term, Landlord and its agents shall have the right to erectusual signs advertising the property for lease and shall have the right to enter the Premises uponreasonable notice during ordinary business hours for the purpose of showing the Premises toprospective tenants.
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     17. UTILITY AND WASTE REMOVAL SERVICES: Tenant shall directly pay costs of all utilities whichare separately metered to the Premises and shall further pay for refuse disposal contracted for byTenant in its own right. Landlord warrants and represents that all such utilities shall beseparately metered.     18. ASSIGNMENT AND SUBLEASING: This Lease may not be assigned nor may all or any part of thePremises be sublet by Tenant without Landlord’s prior written consent which consent shall not beunreasonably withheld; except, however, that no consent shall be needed for an assignment to anyparent, subsidiary or affiliate of (including, by way of example, an entity with a common parent),or related entity to, Tenant. In no event shall any assignment or sublease relieve Tenant from itsobligations to Landlord for the full performance of all of the terms, conditions and covenants ofthis Lease.     19. DAMAGE BY CASUALTY: If the Building is damaged or partially destroyed by fire or othercasualty to the extent of one-half (1/2) or less of the then cost of replacement above thefoundation, the same shall be promptly repaired by Landlord except that the obligation of Landlordto rebuild shall not include any obligation to rebuild those portions of the Premises installed oradded by Tenant. If the Building is destroyed or damaged to the extent of greater than one-half(1/2) of the then replacement cost, either Landlord, with the approval of its mortgagee, or Tenantmay elect to terminate this Lease by giving notice in writing to the other party terminating thisLease given within sixty (60) days of such damage or destruction, in which event, this Lease shallbe terminated as of the date of such notice. If neither party provides such notice, Landlord shallpromptly commence and diligently pursue to completion any repair or restoration needed as a resultof such fire or other casualty.     If Landlord shall proceed to repair or rebuild the Premises, it shall initiate and pursue thenecessary work with reasonable dispatch in the manner consistent with sound construction methods.Tenant agrees to promptly cooperate with Landlord so as to not delay the progress of such repairand restoration.     If the damage or partial destruction to the Building shall, in the opinion of Tenant, renderthe Premises wholly untenantable, then rent shall abate until the Building shall have been restoredand are rendered tenantable. If such damage or partial destruction renders the Buildinguntenantable only in part, the rent shall abate proportionately as to the portion of the Buildingrendered untenantable.     Notwithstanding the foregoing, if damage exceeding one-half (1/2) of the replacement costabove foundation has been incurred, Landlord may at its option terminate this Lease in the eventinsurance proceeds are not available to cover all or substantially all of the estimated cost ofrepair. Landlord shall exercise this option by written notice to Tenant within thirty (30) daysafter the fire or casualty causing such loss, damage or destruction, which notice shall beeffective as of the date of such fire or casualty.     20. CONDEMNATION: If at least ten percent (10%) of the Rentable Square Feet of the Building istaken by the exercise of the power of eminent domain, and such taking renders the Premisesunsuitable for business in the opinion of Tenant, then the term of this Lease shall
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terminate as of the date possession is taken by the condemnor. In the event of a partial taking ofless than ten percent (10%) of the Rentable Square Feet of the Building or which is not extensiveenough to render the Premises unsuitable for business in the opinion of the Tenant, then Landlordshall promptly restore the Premises to a condition comparable to its condition at the time of suchcondemnation less the portion lost in the taking and this Lease shall continue in full force andeffect and the rent shall be reduced in the proportion that the part of the Premises which is takenbears to the original area of the Premises. Notwithstanding the foregoing, in no event shallLandlord be required to expend more than the amount of any condemnation award it receives torestore the Premises after a taking or condemnation. Each party agrees to notify the other of athreatened condemnation promptly upon becoming aware of it.     In the event of any condemnation or taking whether whole or partial, the Tenant shall not,except as provided in the next sentence, be entitled to any part of the award paid for suchcondemnation and Landlord is to receive the full amount of such award. Provided, however, theTenant shall have the right to claim and recover from the condemning authority, but not fromLandlord nor shall Tenant’s claim or award limit or reduce the award to Landlord, such compensationas may be separately awarded or recoverable by Tenant in Tenant’s own right on account of any andall damage to Tenant’s business by reason of the condemnation (including, without limitation, anyaward for business relocation) and for or on account of any loss or cost to which Tenant might beput in removing or replacing Tenant’s merchandise, furniture, fixtures, leasehold improvements orequipment.     21. DEFAULT:     A. The following are events of default by Tenant under this Lease:     i. Tenant shall fail to pay any rent when due and shall fail to pay the delinquent rentwithin ten (10) days after written notice of such failure shall have been given by Landlord.     ii. Tenant shall fail to conform or comply with any of the terms, covenants orconditions of this Lease other than for payment of rent and shall not cure such failurewithin thirty (30) days after written notice thereof to Tenant provided, however, that theTenant shall not be in default after such thirty (30) day period if it has promptlycommenced using and is continuing to use reasonable diligence to cure such failure ofcompliance;     iii. Tenant shall become insolvent, shall make a transfer in fraud of creditors orshall make an assignment for benefit of creditors or shall have a receiver or trusteeappointed for all or substantially all of its assets;     iv. Tenant shall be adjudged bankrupt or insolvent in involuntary proceedingsinstituted against Tenant under any bankruptcy act;     v. Tenant shall vacate or abandon all or substantially all of the Premises.
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     Upon the occurrence of any such event of default, Landlord shall have the option topursue one or more of its remedies pursuant to law or pursuant to this Lease without furthernotice or demand including, but not limited to the following:     (1) Landlord may without terminating this Lease expel Tenant from the Premises,enter upon and take possession of the Premises and expel Tenant or any other personwho may be occupying such Premises therefrom, all without prejudice to any otherremedies which Landlord may have for possession or for the recovery of past due rentand rent accruing under the Lease. Landlord shall not be liable for damages orotherwise by reason of such re-entry. Notwithstanding such re-entry or expulsion ofTenant, the liability of Tenant for rent shall not be extinguished for the balanceof the remaining Primary Term or applicable Option Term, as the case may be, ifTenant has exercised its option to extend. Landlord shall be entitled to recover thesame subject to Landlord’s obligations to mitigate damages as provided by law.     (2) To recover reasonable attorney’s fees incurred by Landlord inconnection with Tenant’s default.     (3) To relet the Premises applying such rents from reletting first to the costsand expenses incurred by Landlord in reletting including brokerage fees, attorney’sand costs of alterations and repairs and, second, to other obligations due Landlordfrom Tenant prior to application of any portion of the rent to offset the futurerent which will become due from Tenant to Landlord under this Lease.     (4) To terminate the Lease and to recover from Tenant all damages Landlord mayincur by reason of the termination of the Lease including the cost of recovering thePremises, reasonable attorney’s fees and the worth at the time of such terminationof the excess, if any, of the rent and charges equivalent to rent reserved in thisLease for the remainder of the Primary Term, or the applicable Option Term if Tenanthas exercised its option to extend, over the then reasonable rental value of thePremises for the remainder of the stated term, all of which amounts shall beimmediately due and payable from Tenant to Landlord.     (5) In lieu of Landlord’s other remedies, Landlord may elect to remedy anydefault of Tenant which remains uncured beyond any applicable notice and graceperiod, in which case the cost of remedying such default including reasonableattorney’s fees shall be deemed to be additional rent hereunder and shall be duefrom Tenant to Landlord with interest thereon at the rate of twelve (12%) per centper annum from the date of payment by the Landlord thereof.     B. Landlord covenants and agrees to promptly comply with all of its obligation under thisLease. If Landlord fails to do so after being provided with notice and opportunity to cure asprovided below, Tenant may pursue all of its legal rights and remedies and shall be entitled torecover all costs and expenses, including attorneys’ fees, it incurs in enforcing Landlord’sobligations hereunder. In addition, if Landlord fails to timely perform any of its obligations
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hereunder, Tenant shall notify Landlord of the default and if Landlord does not cure the defaultwithin thirty (30) days of the notice (or five (5) days if such default disrupts Tenant’sbusiness), Tenant may cure the default. The foregoing rights of Tenant are in addition to those setforth above regarding Tenant’s right to take over construction from Landlord.     22. WAIVER OF DEFAULT: No waiver by the parties hereto of any default or breach of any term,condition, or covenant of this Lease shall be deemed to be a waiver of any subsequent or breach ofthe same or any other term, condition or covenant contained herein.     23. FORCE MAJEURE: With the exception of Tenant’s obligation to pay rent and to satisfy anyother monetary obligations under this Lease, each party shall not be required to perform any term,condition, or covenant in this Lease so long as such performance is delayed or prevented by forcemajeure, which shall mean Acts of God, strikes, lockouts, material or labor shortages, restrictionsby any governmental authority, civil riot, floods, and other cause not reasonably within suchparty’s control and which by the exercise of due diligence such party is unable, wholly or in part,to prevent or overcome.     24. EXHIBITS: All exhibits, attachments, annexed instruments and addenda referred to hereinshall be considered a part hereof for all purposes with the same force and effect as if copied atfull length herein.     25. ENVIRONMENTAL LAWS: Except as provided in the immediately succeeding sentence, Landlordmakes no representation with respect to the Premises’ past, present or future compliance withEnvironmental Laws, which for purposes of this Agreement shall mean all federal, state and locallaws including statutes, regulations, ordinances, codes, rules and other governmental restrictionsand requirements relating to the discharge of air pollutants, water pollutants or process wastewater or otherwise relating to the environment or hazardous substances including, but not limitedto, the Federal Solid Waste Disposal Act, the Federal Clean Air Act, the Federal Clean Water Act,the Federal Resource Conservation and Recovery Act of 1976, the Federal Comprehensive EnvironmentalResponse, Compensation, and Liability Act of 1980, regulations of the Environmental ProtectionAgency, regulations of the Nuclear Regulatory Agency, and regulations of any state department ofnatural resources or state environmental protection agency now or at any time hereafter in effect.Landlord represents that (a) no substance has been or will be introduced to the Premises byLandlord which is in a form, quantity or manner which if known to be present, on, under, in orabout the property would require clean up, removal or some other remedial action under anyapplicable Environmental Laws and (b) Landlord represents, to the best of its knowledge, that notoxic, explosive or other dangerous materials or hazardous substances are present in or on thePremises or have been concealed within, buried beneath, released on or from, or removed from thePremises (it being understood that Landlord has no notice or knowledge of any actions or omissionsof Tenant (including Tenant’s employees, agents, contractors or other invitees) since Tenant firstoccupied the Premises in 1998). Landlord will defend, indemnify and hold harmless Tenant, itspartners, officers, directors, shareholders, employees, agents, lenders, contractors and each oftheir respective successors and assigns from any and all claims, damages, liabilities, losses,costs and expenses of any nature whatsoever, known or unknown, contingent or otherwise (including,without limitation, attorneys’ fees, litigation, arbitration and administrative proceedings costs,
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expert and consultant fees and laboratory costs), that such party may incur as a result of thepresence of, release of or threatened release of hazardous substances in or on the Premises (1)where such claim or liability arises from facts occurring prior to Tenant’s occupancy of thePremises in 1998, and further (2) if caused by Landlord or Landlord contractors performing work onthe Premises. The indemnity contained herein shall survive the expiration or earlier termination ofthis Lease. Tenant agrees that, during its tenancy, it will neither cause nor allow any substanceto be present, used, stored, deposited, treated, recycled or disposed of, on, under, in or aboutthe Premises, in a form, quantity or manner which if known to be present on, under, in or about theproperty would require clean up, removal or some other remedial action under applicableEnvironmental Laws. All such hazardous substances shall be handled in accordance with applicablelaws and/or Environmental Laws. Tenant agrees to hold harmless and indemnify Landlord, itspartners, officers, directors, shareholders, employees, agents, lenders, contractors and each oftheir respective successors and assigns, from any liability, claim or injury based upon an actualor alleged violation of Environmental Laws of any nature whatsoever, known or unknown, contingentor otherwise (including, without limitation, attorneys’ fees, litigation, arbitration andadministrative proceedings costs, expert and consultant fees and laboratory costs), that such partymay incur as a result of the presence of, release of or threatened release of hazardous substancesin or on the Premises arising in connection with the occupancy of the Premises by Tenant or anyoccupant of the Premises or the operations of Tenant’s business on the Premises starting from thedate of Tenant’s original occupancy of the Premises in 1998 and through the term of this Lease. Theforegoing indemnification shall survive the expiration of the term of this Lease.     26. USE OF LANGUAGE: Words of any gender used in the Lease shall be held and construed toinclude any other gender, and words in the singular shall be held to include the plural, unless thecontext otherwise requires.     27. CAPTIONS: The captions or headings of paragraphs in this Lease are inserted forconvenience only, and shall not be considered in construing the provisions hereof if any questionof intent shall arise.     28. SUCCESSORS: The terms, conditions and covenants contained in this Lease shall apply andinure to the benefit of, and be binding upon, the parties hereto and their respective successors ininterest and legal representatives except as otherwise herein expressly provided. All rights,powers, privileges, immunities and duties of Landlord under this Lease including but not limited toany notices required or permitted to be delivered by Landlord to Tenant hereunder may, atLandlord’s option, be exercised or performed by Landlord’s agent or attorney.     29. LANDLORD TRANSFER OF INTEREST: In the event of a complete transfer of Landlord’s title orinterest in the Premises in an arm’s length transaction which occurs after completion of theLandlord’s Improvements, Landlord (or the grantor of a subsequent transfer) shall be relieved ofall liability related to Landlord’s obligations after transfer provided that Landlord’s transfereehas agreed in writing to be bound to the terms of this Lease and provided further that Landlord (orits successor, as the case may be) shall have furnished Tenant with documentation of such transferwithin ten (10) days of the transfer which shall identify the new
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landlord and state that the new landlord has agreed in writing to be bound to the terms of thisLease and provided further that Landlord (or its successor, as the case may be) shall havetransferred the entire security deposit to the new landlord, who shall then be liable therefor.     30. COMPLETE AGREEMENT: This Lease contains the entire agreement of the parties and shall notbe modified except by an instrument in writing which is signed by both parties.     31. AUTHORIZATIONS AND REPRESENTATIONS: Each party hereby severally represents that it hasbeen duly authorized to execute and deliver and perform this Agreement through its members,officers or agents signing on its behalf and affixing any appropriate seal hereto.     32. BINDING EFFECT: This Agreement shall be binding upon, and inure to the benefit of, theparties and their successors, legal representatives and assigns.     33. CONSENT: Whenever the consent or approval of the Landlord is required under this Lease,such consent shall not be unreasonably withheld, conditioned or delayed.     34. SEVERABILITY: The invalidity of any provision of this Lease as determined by a court ofcompetent jurisdiction, shall in no way affect the validity of any other provision hereof.     35. CUMULATIVE REMEDIES: No remedy or election hereunder shall be deemed exclusive but shall,whenever possible, be cumulative with all other remedies at law or in equity.     36. COVENANTS AND CONDITIONS: Each provision of this Lease performable by either party shallbe deemed both a covenant and a condition.     37. NOTICES: Any notice or document required or permitted to be delivered hereunder shall bedeemed to be delivered (a) upon personal delivery or (b) three (3) business days after deposit inthe United States mail, postage prepaid, registered or certified mail, return receipt requested, or(c) the next business day after deposit with a nationally-recognized overnight courier service,addressed to the parties hereto at the respective addresses set opposite their names below, or atsuch other address as they have theretofore specified by written notice delivered in accordanceherewith.     38. TENANT’S PURCHASE RIGHTS:     A. If Tenant is not then in default hereunder and if this Lease remains in full force andeffect, the Tenant or its assignees shall have the option to purchase (“Option”) thePremises pursuant to the terms and provisions hereof for a purchase price equal to the sum of (x)either (i) relative to the Option exercise during the first (1st) Original PremisesLease Year, the sum of Six Million Eight Hundred Seventy-Four Thousand Four Hundred and 00/100Dollars ($6,874,400.00) (representing the amount to be paid for the Premises pursuant to the optionto purchase provided in the prior Lease between Landlord and Tenant) plus the sum of ten (10)
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times the amount of annual rent for either or both the First Expansion Space and the SecondExpansion Space, as applicable, or (ii) relative to the Option exercise during the fifth(5th) or tenth (10th) Original Premises Lease Year, ten (10) times the amountof annual rent (including the annual rent for the Original Premises and, if constructed, either orboth the First Expansion Space and the Second Expansion Space as applicable) paid during the LeaseYear in which the Option is exercised (provided, however, if the Building is expanded or is beingexpanded during the Lease Year in which the Option is exercised, whether during the first(1st), fifth (5th) or tenth (10th) Original Premises Lease Year,then the annual rent utilized for purposes of determining the purchase price shall include a fulltwelve (12) months of the rent to be paid for such expansion space(s) once Tenant commences payingrent for the expanded Building), plus (y) the amount of the prepayment penalty, if any, set forthin the Penalty Notice as described in Section 38(D) below, and plus (z) the sum of the unamortizedportion of all real estate brokerage (leasing) commissions paid by (or to be paid by) Landlord toCresaPartners (or its successors and/or assigns) in connection with this Lease, the expansion intothe First Expansion Space and the expansion into the Second Expansion Space (with suchcommission(s) being amortized on a straight line basis for each such space over the periodcommencing on the date that Tenant starts (or is expected to start) paying rent for each such spaceand ending on the last day of the Primary Term, and the calculation of the unamortized amount foreach such space to be performed on a per day basis). No commissions shall be paid by Landlord toCresaPartners (or its successors and/or assigns) or to any other broker or agent representingTenant in connection with the purchase of the Premises pursuant to Section 38 of this Lease.     B. Provided Tenant is not then in default of this Lease and this Lease remains in full forceand effect, this Option may be exercised by Tenant at any time after the first (1st)day, but not later than ninety (90) days before the last day, of the first (1st), fifth(5th) or tenth (10th) Original Premises Lease Year. If not timely exercisedas provided herein, this Option shall automatically expire upon expiration of the ninetieth (90th)day before the last day of the tenth (10th) Original Premises Lease Year. This Optionshall be exercised as to the Premises by the delivery or mailing of written notice of such exercise(“Option Notice”) by Tenant to Landlord at the address contained in Section 37 hereof. Theclosing on the purchase shall occur on the last day of the Original Premises Lease Year in whichthe Option is exercised (or the next business day thereafter, if the last day of such OriginalPremises Lease Year falls on a weekend or holiday).     C. Within ten (10) business days after an Option Notice is served as provided herein, Landlordshall obtain and provide to Tenant evidence of title to the Premises in the form of a titleinsurance binder (“Commitment”) issued by a title insurance company licensed to issuepolicies in the State of Wisconsin, agreeing to issue to Tenant, upon the recording of the WarrantyDeed to the Premises, its standard title insurance policy in the amount of the purchase price,insuring the interest of Tenant to the Premises conveyed, free and clear of all liens andencumbrances except any created by or under the Tenant, municipal and zoning ordinances, easements,covenants and restrictions of record, and net general real estate taxes and assessments. The costof such title insurance shall be paid by Landlord. If Tenant objects to any title matters, it shallso notify Landlord in writing within ten (10) business days after receipt of the Commitment, andLandlord shall attempt to have such title defect removed. If Landlord is unable to do so, Landlordshall so notify Tenant, and Tenant shall, within ten (10) business days after such notice,
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have the right to terminate the exercise of the Option. If Tenant fails to do so, it shall accepttitle with such defect(s) which will then be included as an exception to warranty in the deed.     D. Within twenty (20) business days after an Option Notice is served as provided herein,Landlord shall notify Tenant in writing of the amount of any prepayment penalties, including anysettlement amount to be paid by Landlord under an interest rate swap arrangement, Landlord willincur with a Non-Affiliate Lender (as defined below) as a result of Tenant’s purchase of thePremises and Landlord’s repayment of any outstanding mortgage loans against the Premises(“Penalty Notice”). Tenant shall, within ten (10) business days after its receipt of thePenalty Notice, have the right to terminate the exercise of the Option. If Tenant fails to do so,the amount of the prepayment penalties set forth in the Penalty Notice shall be included in thepurchase price to be paid by Tenant in connection with its exercise of the Option. The term“Non-Affiliate Lender” means a lender that Landlord has dealt with on an arms-length basis and thatis not any of the following: (i) a person or entity related to Landlord as an owner, member ormanager of Landlord (each, a “Subject Person”), (ii) a person that is a family member of a SubjectPerson, (iii) an entity directly or indirectly controlled by a Subject Person, (iv) an entitycontrolled by Landlord, (v) an entity that together with Landlord are under common control, or (vi)an entity where a Subject Person owns, directly or indirectly, more than one percent (1%) of suchentity’s voting securities.     E. At closing, Landlord shall execute a Warranty Deed conveying the Premises to Tenant subjectonly to the title exceptions listed above and such other customary documents as may be reasonablyrequested by either party or their counsel. Net general real estate taxes for the year of closing,water and sewer use charges and other customarily prorated or adjusted items will not be proratedand adjusted but shall be the responsibility of the Tenant. Landlord shall pay the transfer fees.Notwithstanding the foregoing, any prepaid real estate taxes or special assessments being held byLandlord shall be returned to Tenant at closing along with the security deposit.     39. WAIVER AND INDEMNITY: Except to the extent of any injury or damage to persons or propertycaused by Landlord’s negligence or willful misconduct, Landlord shall not be liable for injury ordamage to the person or property of Tenant, Tenant’s employees, contractors, invitees, customers orany other person in or about the Premises from any cause whatsoever, and Landlord shall not, in theabsence of Landlord’s negligence or willful misconduct, be liable for injury to Tenant’s businessor for any loss of income or profit therefrom. Tenant agrees to protect, indemnify and saveharmless Landlord from and against any injury to or death of persons or loss of or damage toproperty, including without limitation, the person and property of Tenant, its agents, employeesand invitees, (i) occurring on the Premises and (ii) in any manner directly or indirectly arisingout of or in connection with the use and occupancy, or disuse, of the Premises, any part thereof,or any improvement now or hereafter located thereon, by Tenant or any person holding under Tenant,except to the extent that the same results from Landlord’s reckless or willful misconduct. Subjectto the foregoing limitations on Landlord’s liability, each party agrees to protect, indemnify andsave the other harmless from and against any and all penalties, charges, claims, losses, damages,expenses, liabilities, demands and causes of action, and any reasonable expenses (includingattorneys’ fees) incidental to the defense thereof incurred by the indemnified party, arising outof or resulting from any failure of the indemnifying party,
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in any respect, to comply with and perform all of the requirements and provisions of this Lease asimposed on it pursuant to the terms hereof. If the indemnified party believes it is entitled toindemnification hereunder, it shall so notify the indemnifying party with such notice identifyingthe claim as to which indemnification is being requested. The indemnifying party shall, within ten(10) business days after being sent such notice, either accept the defense of that matter,providing the name of counsel being retained to provide such defense, or decline to accept suchdefense. If the indemnifying party either (a) declines to accept such defense; or (b) suggestscounsel to defend unacceptable to the indemnified party, the indemnified party may then retain itsown attorney and shall be entitled to recover its attorneys’ fees if it should be determined thateither (i) the indemnifying party was obligated to defend and did not accept such defense; or (ii)the indemnifying party accepted such defense but proposed counsel to defend such matter that theindemnified party reasonably objected to.     40. QUIET ENJOYMENT: Provided that Tenant is not in default under this Lease beyond anyapplicable notice and grace period, Tenant shall, throughout the entire Lease term, have exclusiveuse and quiet enjoyment of the Premises. Landlord agrees to provide Tenant written copies ofLender’s agreement(s) to not disturb Tenant’s rights under this Lease Agreement unless Tenant is indefault under this Lease beyond any applicable notice and grace period (a) within reasonable timeafter execution of this Lease for all current Lenders, and (b) within a reasonable time after anyadditional indebtedness is incurred by Landlord, for such future Lenders, if any.     41. ENFORCEMENT COSTS: The defaulting party shall pay all reasonable costs, attorneys’ feesand expenses that may be incurred by the non-defaulting party in enforcing the provisions of thisLease.     42. SURRENDER AT TERMINATION: At the termination of this Lease for any reason, Tenant shallquietly and peaceably surrender possession of the Premises (and any improvements located thereon)to Landlord, maintained as herein provided and free of any and all claims thereto by Tenant or anyparty holding under Tenant.     43. HOLDING OVER BY TENANT: In the absence of an earlier default by Tenant and termination ofthis Lease by Landlord, in which event Section 21 hereof shall govern, if Tenant holds over orremains in possession or occupancy of the Premises after the expiration of the term of this Lease,such holding over or continued possession or occupancy, if rent is paid by Tenant and accepted byLandlord for or during any period of time it so holds over or remains in possession or occupancy,shall create only a tenancy from month to month at one and one-half (1-1/2) times the last monthlyrental and upon the same terms and conditions herein contained (other than the length of term),which may at any time be terminated by either Landlord or Tenant giving to the other twenty-eight(28) days’ written notice.     44. PAYMENTS TO BE ADDITIONAL RENT: All payments to be made by Tenant hereunder, whether ornot designated as rent, shall be deemed additional rent (but not for purposes of Tenant’s Option toPurchase), so that in the event of any failure by Tenant to make timely payment hereunder, Landlordshall be entitled to all of the remedies available at law or equity, or under this Lease, for thenonpayment of rent.
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     45. SUBORDINATION:          (a) At Landlord’s option, this Lease shall be and is subordinated to any existing mortgagescovering the Premises, any extension or renewal thereof, or to any new mortgages which may beplaced thereon from time to time; provided, however, anything to the contrary contained hereinnotwithstanding, every such mortgage shall recognize the validity of this Lease in the event of aforeclosure of Landlord’s interest as long as Tenant shall not be in default under any of the termsof this Lease beyond any applicable notice and grace period. Tenant agrees to execute, within ten(10) days after receipt of written request from Landlord, whatever industry standard instrumentsmay be requested by Landlord’s mortgagee(s) to effect such subordination so long as it contains theaforesaid non-disturbance provisions.          (b) In the event any mortgagee shall elect to have this Lease prior to the lien of itsmortgage then, upon notice to Tenant thereof, this Lease shall thereupon be deemed prior to thelien of any such mortgage. The provisions of this Article shall include Deeds of Trust and similarsecurity instruments.     46. ESTOPPEL CERTIFICATES: Each party shall, without charge, at any time and from time to timehereafter, within ten (10) days after receipt of written request from the other, certify by writteninstrument duly executed and acknowledged to any mortgagee or purchaser (or proposed mortgagee orproposed purchaser) of the Premises, or any other person, firm, or corporation specified in suchrequest: (a) as to whether this Lease has been supplemented or amended, and if so, the substanceand manner of such supplement or amendment; (b) as to the validity and force and effect of thisLease in accordance with its tenor as then constituted; (c) as to the existence of any defaultthereunder, and if there are any defaults, specifying same in detail; (d) as to the existence ofany offsets, counterclaims or defense thereto; (e) as to the commencement and expiration dates ofthe term of this Lease; and (f) as to any other matters as may reasonably be so requested. Any suchcertificate may be relied upon by the party requesting it and any other person, firm or corporationto whom the same may be exhibited or delivered, and the contents of such certificate shall bebinding on the party who completed such certificate.     47. INTEREST: All rent and other payments to be made by Tenant to Landlord hereundershall bear interest from and after the due date thereof at the rate of twelve percent (12%)per year.     48. BROKER’S FEES: Each of Landlord and Tenant warrants and represents to the other that,except as disclosed in this Section 48, it has had no dealings with any person, firm, broker orfinder in connection with the negotiation of this Lease and/or the consummation of the transactioncontemplated hereby, and that except as disclosed herein, no commission or finder’s fee is due anyperson or entity in connection with said transaction. Landlord and Tenant hereby agree toindemnify, protect, defend and hold the other harmless from and against any liability forcompensation or charges which may be claimed by any person or entity purporting to have acted onbehalf of Landlord or Tenant, as appropriate, in connection with said transaction with Landlordacknowledging that CresaPartners has worked for Tenant in connection with the lease
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relationship contemplated herein and that Landlord agrees to pay CresaPartners a commissionrelating to this Lease pursuant to the terms of that certain Commission Agreement betweenCresaPartners and Landlord in the form attached hereto as Exhibit H.     49. TIME OF ESSENCE: Time is of the essence with respect to the performance of all obligationsto the performed or observed by the parties to this Lease.     50. LIMITATION ON DAMAGES. Notwithstanding anything to the contrary contained in this Lease,in no event shall either party be liable to the other party for any indirect, consequential orpunitive damages (including loss of profits or business opportunity) arising under or in connectionwith this Lease.     IN WITNESS WHEREOF the parties have executed this Lease as of the date and year first writtenabove.     Landlord:Carl Ruedebusch LLC   4605 Dovetail Drive   Madison, WI 53704        By: MemberManager Carl Ruedebusch(SEAL)        (Title)         Date: 11/26/08        By: /s/ MICHAEL J. EAGAN(SEAL)   Michael J. Eagan, Member Manager    (Title)         Date: 11/26/08       Tenant:Cardiac Science Corporation   3303 Monte Villa Pkwy.   Bothell, WA 98021-9806        By: /s/MICHAELMATYSIK    MichaelMatysik, Chief Financial Officer    (Title)         Date: 11/26/08  
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